Gold has traded between $1,666 and $1,678 so far today…as of 6:20 am Pacific, the yellow metal is down $2 an ounce at $1,673 after yesterday’s strong move to the upside…Silver is off a dime to $30.76 cents…Copper is down 3 pennies to $3.66…Crude Oil is 66 cents lower at $93.16 while the U.S. Dollar Index has fallen another one-third of a point to 79.45…
Excellent article at www.mineweb.com this morning regarding how an increasing number of farmers in India appear to be gradually moving away from Gold to investing in Silver and real estate…
U.S. Dollar Chart Update
The U.S. Dollar Index got hit hard yesterday, and it’s suffering again this morning…it doesn’t surprise us that the greenback has been struggling over the last several months given the chart pattern below (2.5-year weekly chart from John)…the right shoulder of a head-and-shoulders top continues to form…the risk of a break below important support at 79 during this first quarter has to be considered high…such a development would be be bullish for commodities and the Venture Exchange…
Japan’s New Government Turns On The Stimulus Taps
Japan’s $117 billion economic stimulus package is a positive start to revive a frail economy…but many analysts believe the government needs to follow this up with long-term structural changes and the central bank has to chip in with some bold moves – otherwise, disappointment is sure to follow…faced with an economy in recession, Japan’s new government has unveiled the country’s biggest spending boost since the financial crisis and one it hopes will boost economic growth by 2 percentage points and create 600,000 jobs…Japan’s economy, the world’s third largest, has contracted for two quarters running, pushed into a recession by weak global demand for its exports…”Japan’s economy has been very weak over the past couple of quarters and some stimulus is necessary to get the growth rate up at least over the near term,” Thomas Byrne, senior vice president at Sovereign Risk Group, Moody’s Investors Service, told CNBC…”Other things are necessary to keep the growth rate up over the longer-term though”…Shinzo Abe, who became Japan’s new prime minister last month after his Liberal Democratic Party was returned to power with a comfortable election win, has promised to revive the economy and urged the central bank to introduce aggressive monetary easing and double its inflation target to 2%…
Today’s Markets
Asian markets were mixed overnight with Japan’s Nikkei average gaining 149 points to 10802 while China’s Shanghai Composite retreated 40 points to 2243 on some healthy profit taking that snapped a five-week winning streak…China’s annual consumer inflation rate accelerated to a seven-month high of 2.5% in December on rising food prices…China reported superlative export data Thursday, and all indications are the economy there is revving up significantly – defying last year’s doomsayers…
European shares are mixed today while stock index futures in New York as of 6:25 am Pacific are pointing toward a flat open in New York…the Venture Exchange closed at 1240 yesterday, the top of a down trendline that has been in place since early 2011…1240 would be a significant level for the Index to overcome…China’s market broke out of its down trendline from early 2011 a few weeks ago, and upside momentum quickly accelerated…
Touchstone Exploration Inc. (TAB, TSX-V)
An oil and gas play that appears to be on the rebound in 2013 is Touchstone Exploration Inc. (TAB, TSX-V) which had one of its highest volume days ever on Wednesday (2.5 million shares)…while the Venture itself is just shy of breaking above its nearly two-year down trendline as mentioned above, many individual stocks have already done so including Touchstone this week…below is a 2.5-year weekly TAB chart from John…TAB closed up for the fourth consecutive session yesterday and will likely encounter near-term resistance at 30 cents…this is one to keep on the radar screen…
Volta Resources (VTR, TSX-V)
Volta Resources (VTR, TSX-V) has released an updated NI-43-101-compliant mineral resource estimate for its West Afican Kiaka Gold project (southern Burkina Faso)…Ouagadougou in southern Burkina Faso…the update follows completion of an additional 233 holes (38,602 metres) drilled in Phase 4 at the Kiaka Central area…the total Kiaka project hosts over 10 million ounces in measured, indicated and inferred resources as detailed by the company yesterday…the stock closed up a nickel on the news, putting it above its 50-day moving average (SMA) for the first time since late September…below is an updated 6-month daily chart from John…the trend turned bullish in late December…
Wildcat Silver (WS, TSX)
We haven’t looked at Wildcat Silver (WS, TSX) for a while but it put in a nice double bottom late last month, when no one wanted to buy it, and has climbed 40% since then…check out their news release yesterday which included updated drill results from the company’s Hermosa Property in Arizona…
Note: John, Jon and Terry do not hold positions in TAB, VTR or WS.
Hey BMR maybe you can clarify something for me. Why is it that both the tsx and tsx.v are under performing compared to other index’s. S&P is at 5 year high, European stock market is near 2 year high,Japan’s Nikkei is on a run not seen since 1988 and is near 2 year high and yet Venture and TSX are performing very poorly. What’s your take on things? Do you think we will have our day? Thanks
Comment by Tony T — January 11, 2013 @ 6:37 am
JON: is there a website to see daily volumes on TSX Venture? I heard once volumes start to break through the 200M per day, we should be on our way up?
Comment by STEVEN — January 11, 2013 @ 7:13 am
The other interesting thing is that the major indices have been hitting new highs despite the fact so many investors are still on the sidelines (with cash). I think that will start to change. The Venture hugely outperformed the major markets after the 2008 crash, and then first started under-performing in the spring of 2011 and that’s when the trouble began. These things go in cycles. So the Venture’s turn is coming again soon. I can’t help but be bullish given the look of the Venture chart over the last 8 months or so. Great basing pattern, double bottom, and a reversal in the 1,000 day SMA. Right now it’s like a very slow moving train but the train is finally going in the right direction after 2 difficult years. Should start to pick up steam in the weeks ahead. Patience, everyone.
Comment by Jon - BMR — January 11, 2013 @ 8:01 am
@jon. Any idea what the disconnect is with vtr. Followed this one for two years now, with a resource like they have and continually hitting incredible holes how is it that they are sitting where they are. Is it just a matter of the times now or is there something else I’m missing thst has caused them to be so undervalued.
Comment by Heath — January 11, 2013 @ 8:02 am
Jon,
You’re so bullish it makes me think you ate some bulls balls….
rbw still blows.
we’re all going bankrupt
i’m going to sell 147, 286 shares of RBW at market…
lol
Comment by Avo — January 11, 2013 @ 8:40 am
Steven… go to tmx.com, then click on market activity… volume leaders as welll as volume!!
Comment by Jeremy — January 11, 2013 @ 10:25 am
I saw a stockhouse post on the VTR talking about this website. It looks like some good info on here. I quite like the Volta story, I think there is a lot of potential with the company.
Comment by Bucky — January 11, 2013 @ 10:01 pm
Thanks Jeremy….sometimes I find differences on other sites so wasn’t sure…so, only 80M on Friday.?
Comment by steven — January 12, 2013 @ 7:38 am
Hey BMR maybe you can clarify something for me. Why is it that both the tsx and tsx.v are under performing compared to other index’s. S&P is at 5 year high, European stock market is near 2 year high,Japan’s Nikkei is on a run not seen since 1988 and is near 2 year high and yet Venture and TSX are performing very poorly. What’s your take on things? Do you think we will have our day? Thanks
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SUPPORTED BY GOVERNMENT ACTIONS….!!!
PRINT, PRINT AND PRINT !!!
Comment by TONSIL — January 12, 2013 @ 10:15 am
HEATH,of course your missing something,its management,what else,get your fat head out of your a.. and look around,bunch of jr. companys comming out with good results and not going anywhere,is it management of any of these companys? of course not,rbw first time drill results i think investors want to see more,includeing myself,still hold rbw and numerous others and we have to stay patient.i’m with bev,cant handle it get out and then try and get your foot out of your a..,later,toshea heath,bottom line is we have to be patient and throw emotion out the door,frustrated yes,panicing no.back on the road again have a nice week….
Comment by tom — January 12, 2013 @ 10:22 am
Answered this question yesterday or the day before in the comments section……if you look at the Venture over the last 8 months or so, it has formed a beautiful basing pattern and then it had a double bottom in December but stayed above the June low of 1154 which was extremely significant……the Venture train has turned around after a two-year slide and is now going in the right direction, albeit very slowly at the moment……it needs to cross a couple of key resistance areas, one of which interestingly is 1240 which is the top of the downtrend line that has been in place since early 2011…then watch momentum pick up…..if you look at the history of the venture, even going back to the days of the VSE, it always goes thru these cycles of under-performing or out-performing the major markets…my suspicion is, we’re about to see a return to out-performance in 2013 as a risk-on appetite returns……..there are also close similarities between the venture and the shanghai composite….we have pointed this out consistently over the past year…..China in the last few weeks just broke out of its 2-year down trendline, and it has led the venture on major trend shifts over the past several years…… both are speculative markets…….right now is the best time to be jumping all over good quality plays on the venture….a lot of cash is still sitting on the sidelines……the major indices are moving…….that’s the perfect recipe for a significant move very soon into the juniors……..
Comment by Jon - BMR — January 12, 2013 @ 10:25 am
Jon. Could you please give your thoughts on my vtr question
Comment by Heath — January 12, 2013 @ 11:05 am
I’ll get to it when I can today or tomorrow.
Comment by Jon - BMR — January 12, 2013 @ 11:07 am
Wow, Heath says please.
Comment by Rick — January 12, 2013 @ 11:08 am
Hi BMR,
Could you address GTA as well. There were a couple requests / comments over the last week or so.
Regards
Christine
Comment by Christine — January 12, 2013 @ 11:39 am
Burkina Faso is one of the hottest mining districts in the world and Volta’s 6 million ounce resource positions them as an ideal candidate for a takeout by a major like IAMGOLD.
In the Dominican Republic, Everton Resources has some of the best properties especially a large concession that is immediately next to Barrick’s 30 million ounce Pueblo Viejo.
Comment by Bucky — January 12, 2013 @ 12:35 pm
@Heath – The reality is that the current market is not valuing resource assets with any logical formula. Volta was oversold by retail and funds and has not recovered due to continuing weak market demand.
Comment by Bucky — January 12, 2013 @ 12:42 pm
It seems to me a long while since BMR did CEO interviews of companies that you follow. Would be great to see some of these start up again!
Comment by Michael — January 12, 2013 @ 5:38 pm
This will be happening soon, Michael.
Comment by Terry - BMR — January 12, 2013 @ 6:07 pm
Thanks Bucky. Huge disconnect in sp for sure. Common sense I guess would indicate thst its just another company grossly undervalued due to current market conditions, just curious if I was indeed missing something else that would explain the valuation as it seems to me to be even more undervalued then most others.
Comment by Heath — January 12, 2013 @ 6:35 pm